Google has been rolling out fiber to neighborhoods in Kansas City and lately to the nearby suburbs for over a year now. But the addition of Austin changes things dramatically. To paraphrase an Asimov book from a while back, sometimes the only numbers that make sense are zero, one, and many – but not two.

In other words, zero makes sense if the model doesn’t work, while one makes sense if it works well enough to exist but not to reproduce. But all other positive numbers mean the same thing as each other – that the business model works, and presumably makes money.

Google didn’t have to leave the KC metro area to make the case for viability. The only reason you do that is to make more money than you could in just one market.

In other words, if Google follows through today and 1Gbps home connections for Austin are on the menu, then I hereby eat my own words. Google apparently does want to be a network operator.

The only question is how fast they want to make it happen, and just how good the financials in KC are to make them want to do it. And given the evolution beyond the demo, how will the incumbents respond to the threat?

I ended my look at Google Fiber’s plans for Austin with the question of how the incumbents might respond to this evolution beyond the demo. Apparently, AT&T was way ahead of me, because they stepped up and unveiled their own Gigabit fiber buildout plan for Austin. This sets up quite an interesting dynamic, not so different from that popular poker variant, Texas Hold’em.

This is obviously no coincidence, AT&T was ready for Google’s announcement and is trying to make several points:

* No more playing favorites! This reflects the simple fact that incumbent carriers generally see their main competition as the regulators, while competitive carriers are best seen (by regulators) and not heard (by customers). ILECs and Cables have long made the case that Google manipulated KC into giving them special treatment, and want the same. And AT&T plans to either get it, or shed light on the unfairness of not getting it.

* Let’s see how your business model survives direct competition! Whether Google Fiber works economically in Kansas City or not, in Austin AT&T is going to make them work for it by facing a well-funded competitor who just might make it *not* worth it to take this to more AT&T markets. How quickly will those fiberhoods fill up in Austin when AT&T’s customers have the option to upgrade directly.

* We can do this all day! According to the PR, “This expanded investment is not expected to materially alter AT&T’s anticipated 2013 capital expenditures.” That’s financial speak for ‘This is pocket change for us, pick another city we dare you’. The fact that they thought the rate of return on FTTH sucked before doesn’t mean they can’t absorb it for a turf war.

But on the other hand, both sides are at a stage where they could be bluffing. Google’s entire purpose still could be to provoke such a response as this, and having done so they could take a step back and let AT&T do some FTTH they wouldn’t otherwise have done. And AT&T hasn’t actually committed any money to the project yet, so if they don’t like the reception this gets from local government, utilities, and regulators – they can just use that fact as fodder for public complaints against special treatment.

They each have different cards. Google has the edge in public opinion and is seen as the champion of Gigabit fiber. AT&T has more infrastructure and personnel already in place. But they don’t get to pick the cards they get for the next round, Austin does.

AT&T Announces Intent to Build 1 Gigabit Fiber Network in Austin

O PR da AT&T é pura ironia, da primeira a última linha, deboche até

AUSTIN, Texas, April 9, 2013 /PRNewswire/ -- AT&T Inc. (NYSE: T) said today that it is pleased to see local communities and municipalities acknowledging the promise and power of economic development associated with telecommunications investment.

"Most encouraging is the recognition by government officials that policies which eliminate unnecessary regulation, lower costs and speed infrastructure deployment, can be a meaningful catalyst to additional investment in advanced networks which drives employment and economic growth," said Randall Stephenson , AT&T chairman and CEO.

Today, AT&T announced that in conjunction with its previously announced Project VIP expansion of broadband access, it is prepared to build an advanced fiber optic infrastructure in Austin, Texas, capable of delivering speeds up to 1 gigabit per second. AT&T's expanded fiber plans in Austin anticipate it will be granted the same terms and conditions as Google on issues such as geographic scope of offerings, rights of way, permitting, state licenses and any investment incentives. This expanded investment is not expected to materially alter AT&T's anticipated 2013 capital expenditures.

AT&T consistently invests in U.S. communities -- $98 billion in capital in the past five years, more than any other public company -- and remains committed to working with any metropolitan community to reach agreement on incentives to improve the climate and speed of overall telecommunications infrastructure investment – facilitating both wired and wireless broadband access. Our potential capital investment will depend on the extent we can reach satisfactory agreements.

Google Fiber Keeps Expanding: Now Headed to Provo, Utah

Google wants to bring its ultra-high-speed internet service to Provo, Utah, the city’s mayor
John Curtis announced at a press conference today.

Instead of building new infrastructure, Google plans to acquire the existing iProvo fiber-optic network, a troubled service that the city built in 2004, and then privatized four years later. If the deal is approved, Google will continue to offer the iProvo to existing customers under the Google Fiber brand. “In addition, Google Fiber will commit to upgrade the iProvo network to Gigabit technology,” Mayor Curtis wrote on his blog. A vote is scheduled for Tuesday, April 23.

Google would offer similar plans and pricing as it offers in Kansas City. “If the deal is approved and the acquisition closes, we’d offer our Free Internet service (5 Mbps speeds) to every home along the existing Provo network, for a $30 activation fee and no monthly charge for at least seven years,” the company’s blog post announcing the plan reads.

After the network’s operators ran into financial troubles, the City of Provo took back ownership of the iProvo network earlier this year.

After a year long long competition between over 1,000 cities, Google announced in 2011 that Kansas City would be the first to receive the service. The company began rolling out Google Fiber to its first neighborhoods in late 2012. Since then the company has announce two additional cities: Olathe, Kansas and Austin, Texas.

Although Utah may not spring as readily to mind as the Bay area, Seattle or Austin when thinking about tech hubs, the region is in fact home to hundreds of tech companies. The University of Utah in Salt Lake City was home to much pioneering computing research, and was one of the original four nodes of ARPANET, the predecessor to the internet. And, as Google points out, Provo is second in the nation in terms of number of patents filed.